{"id":357799,"date":"2016-04-04T10:45:29","date_gmt":"2016-04-04T15:45:29","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-law\/employment\/losing-a-job\/implied-employment-contracts-and-wrongful-termination.html"},"modified":"2025-03-31T09:55:00","modified_gmt":"2025-03-31T14:55:00","slug":"implied-employment-contracts-and-wrongful-termination","status":"publish","type":"page","link":"https:\/\/www.findlaw.com\/employment\/losing-a-job\/implied-employment-contracts-and-wrongful-termination.html","title":{"rendered":"Implied Employment Contracts and Wrongful Termination"},"content":{"rendered":"\n
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Implied Employment Contracts and Wrongful Termination<\/h1>\n
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\n By Olivia Wathne, J.D.<\/a> | Legally reviewed by Melissa Bender, Esq.<\/a>\n | Last updated\n
\n \n <\/i>\n Legally Reviewed\n <\/summary>\n\n
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This article has been written and reviewed for legal accuracy, clarity, and style by FindLaw\u2019s team of legal writers and attorneys<\/a> and in accordance with our editorial standards<\/a>.<\/em><\/p>\n\n <\/div>\n <\/details>\n\n

\n \n <\/i>\n Fact-Checked\n <\/summary>\n\n
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The last updated date refers to the last time this article was reviewed by FindLaw or one of our contributing authors<\/a>. We make every effort to keep our articles updated. For information regarding a specific legal issue affecting you, please contact an attorney in your area<\/a>.<\/em><\/p>\n\n <\/div>\n <\/details>\n<\/section>\n

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As an at-will employee, you could lose your job at any time. But if your employer made an implied contract, firing you may violate that contract. This situation is one type of wrongful termination. Employees can take legal action in such cases.<\/p>\n\n <\/div>\n\n

When you lose a job, your rights can depend on the type of employment contract you have. In general, an at-will employment relationship means that either the employer or the employee is free to end the relationship. This action can happen at any time and for any legal reason.<\/p>\r\n

A major exception to this relationship is wrongful termination<\/a>. Wrongful termination can happen when an employer fires an employee against an implied contract. An implied contract is based on the employer\u2019s actions.<\/p>\r\n

Your boss might have indicated certain terms about your job, such as how long it will last. In turn, you assume those terms will apply to your job. Proving the existence of an implied contract is difficult.<\/p>\r\n

Learn about wrongful termination and your rights as an at-will employee. Understanding these rights can help you stand up for yourself in the workplace. But if you need stronger advocacy, you can also discuss these rights with an employment lawyer<\/a>.<\/p>\r\n

Getting Fired from At-Will Employment<\/h2>\r\n

State and federal laws govern the employment-at-will doctrine<\/a>. Employment relationships are presumed to be at-will in all states except Montana<\/a>.<\/p>\r\n

At-will employment means employers can fire employees at any time and for any reason. This type of employment gives employers a high level of discretion.<\/p>\r\n

Yet, at-will employees<\/a> still have important legal rights. Employers can\u2019t fire employees for an illegal reason. Discrimination is an example of an illegal reason. At-will employees have protection against discrimination<\/a>. The firing also can\u2019t violate a contractual agreement. This limitation includes both express and implied contracts.<\/p>\r\n

Employers can have good cause, or \u201cjust cause,\u201d for termination. Good cause may include poor performance or misconduct. If a dispute arises, an employer may use these legitimate reasons to prove that termination of an at-will employee wasn\u2019t wrongful.<\/p>\r\n

Labor laws provide certain rights and protections<\/a> to employees. They often require employers to give notice before they terminate employees<\/a>. This is particularly true in cases of mass layoffs or plant closures.<\/p>\r\n

Implied-Contract Exception to At-Will Employment<\/h2>\r\n

An implied contract of employment can override at-will employment. This type of contract<\/a> can come from an employer\u2019s representations of continued employment. Many times, employer policies or handbooks can show proof of an implied contract.<\/p>\r\n

For example, an employer\u2019s conduct might reassure an employee about their role\u2019s job security amid layoffs. It might give the employee enough reason to expect their position will be secure. Laying off the employee would break the reasonable expectation<\/a> the employer created. This action could be a breach of contract because the employer implied employment terms.<\/p>\r\n

The law treats this scenario as an exception to at-will employment. Implied assurances can be legally binding even without a written contract<\/a>. This can serve as evidence in case of adverse employment actions.<\/p>\r\n

But it isn’t easy to prove the existence of an implied contract. It depends on the specific facts of the case, your state’s laws, and the evidence you’re able to present.<\/p>\r\n

How Courts Treat the Implied Contract Exception<\/h2>\r\n

Courts vary in how they treat implied contract exceptions. These differences can affect your legal options.<\/p>\r\n

Many courts have ruled that employee handbook provisions can imply a contract. For example, if a handbook says employees will only get fired for a good reason, the employer must have just cause before taking action.<\/p>\r\n

For example, a California court stated<\/a> that when there is no express or written agreement<\/a>, other evidence matters. The issue is whether the evidence points to a mutual understanding of employment terms. The court also found that the length of time the employee has worked for the employer can’t form an implied contract on its own.<\/p>\r\n

Employee Handbook Disclaimers in Court<\/h3>\r\n

Some employee handbooks have disclaimers about at-will employment. For example, a handbook may state: \u201cYour employment constitutes at-will employment. This handbook does not create an employment agreement.\u201c<\/p>\r\n

In states with the implied contract exception, courts have generally agreed that this disclaimer language doesn’t establish at-will employment. So, an implied agreement could still exist even if the handbook says otherwise.<\/p>\r\n

But courts generally look at all evidence. This means they’ll consider disclaimer language when determining the terms of a worker\u2019s employment. They’ll also consider length of employment, employee policies, and employment history. It depends on your state’s laws.<\/p>\r\n

Filing a Wrongful Termination Claim<\/h2>\r\n

Before filing a wrongful termination claim<\/a>, you should gather evidence, such as:<\/p>\r\n